Case Analysis Home Furniture Ltd.

Question: Give a brief a discussion on home furniture ltd? Answer: With time, corporations have expanded in different parts of the world. Today, the organizations have to manage the employees from different cultural background. The large and multinational organizations like Toyota, Apple, and Google etc. have to manage their operations across the world. Toyota is a Japanese automobile manufacturer that has to manage the Asian workforce in its American plants. Likewise, Apple is an American multinational that has to manage its resources in Chinese plant (Miska, 2011). The organizations have taken the path of globalization to target new customers and to attain cost advantage. The management of Apple realizes that the production cost of an I Phone is much less in China as compared to American plant. It would be correct to say that the cost of operations is the major driver to expand the business in a new country. With this move, organizations also get access to new customers and new target market. The globalization aims to create a singular economy whe re transaction could be free across different regions. It would be correct to say that the cultural differences is the major deterrent of organizations expansion in new regions. There is a fundamental difference in the perception and attitude of Chines and American worker. Therefore, Apple Inc. cannot have the same set of policies to manage its workers in American and Chinese factory. It is correct that globalization and operations in the multicultural environment is the success key for large and multinational organizations. Therefore, organizations must learn to manage employees form different cultures and organizations must use strategies and polices that could foster harmony and team work among employees from different cultural backgrounds. Home Furniture ltd. is into operation for close to 45 years. The company started its operations from Finland and expanded in European countries and United States of America. The future vision of the company is to expand in Asian countries like India and China. It appears that it is a good move for the company as India and China covers more than 35% of the world population. However the management of Home Furniture has faced certain issues to manage its operations in the multicultural environment of America and Europe. Most of the issues are cultural in nature as there exists fundamental differences in the culture of Europe and the culture of USA. The first and the most important problem for Home Furniture is the different employee perception of employees in USA and Europe. The concept of trade unions and employee group is more prevalent in Europe as compared to USA (Frost, 2011). The American employees want more freedom and flexibility, whereas the management wants to control the empl oyees as they control in European region. The second problem is the reward and compensation system. Management in the USA promotes performance pay while the parent company emphasizes other aspects of employment relations, like participation of employees having voice through works councils. The American employees want to work in an independent manner and this contradicts the culture of headquarter. The third problem is the notion of team work. When management from the parent company attempted to introduce teamwork, local management of subsidiaries in the US had a different perception of teamwork facilitating the rotation of jobs and increasing flexibility rather than creating more autonomous work groups (Selmer, 2012). It appears that there is a difference in the definition of team work across these regions. It would be correct to say that there is no easy solution to the problem of Home Furniture. The problem for the company can be broken down at organizational level, at leadership level and at employee level. Recently, there has been a change in the leadership of the company. The new CEO is the British who wants that every communication should be in English (Wagner, 2011). This is a small language change within the organization but it has the potential of big impact. With this move, the old employees of the company that are weak in English might feel cheated. Therefore, the recommended strategy for the new CEO is to focus on a phased approach rather than a big bang approach. At the first step, the CEO should not have eliminate the use of local language. Even if CEO wanted to switch to English, the decision should be based on feedback of various employees (Maznevski, 2010). The CEO should realize that employees are the biggest assets of the organizations that operate in multicultural en vironment. It is also important that employees should also understand their responsibility. The management should develop a system where employees respect the culture of other employees. The objective of the management should be to avoid and overcome the cultural differences. The cultural differences of different regions and cultures have a direct impact on the leadership style. There are various leadership styles like transactional, transformational, democratic, situational etc. The choice of the leadership style would depend on the nature of the business and the culture of the employees (Ahamer, 2011). The democratic style of leadership could be good when the time size is low and people have similar perceptions and attitudes. For the scenario of Home Furniture, the situational leadership style appears to be the best leadership style. It is recommended that the leader should have an open approach towards the various problems in the country. The new CEO should not have any pre-conceived notion of the problem and the decision should be taken based on the situation in hand. The training and development is the other key area that the organizations should focus. The cultural differences of the employees could be mitigated with the cultural training programs ( Verbeke, 2010). It is important that the organizational goals and objectives should be communicated to all the stakeholders through training programs. It is important that the leaders should have flexible decision making skills when they have to work in a multicultural environment. The decision making style that works best in one culture may not be a good style in a different culture. For example, the workers in America wants to contribute to management decision. Therefore, they would want that the senior management would want their suggestions. However, this is not the case in Japan. In general, the Japanese workers are very hard working and they want that senior management should lay down the work for them. They would not want to involve directly in the strategic decision making. The focus of leaders in the multicultural environment should be to address the expectations of different employees (Ricart, 2011). The problem exist as people from different culture has different expectations and therefore it is difficult for the leader to reach a common ground. Therefore, one of the objective of leaders is to bridge the gap between empl oyees expectations and management perception of employees expectations. The new CEO of Home Furniture should look for decentralization as the solution. It appears that the headquarter of the company does not want to leave the control of the firm and the control of employees in different region. This may not be a good approach for the company. It is recommended that the company should explore the avenues of decentralization. The headquarter should act as a mentor and guide for different locations. However, the regional offices should be allowed to make their own strategy and decision. It appears that the decentralization could be the solution for Home Furniture. The new CEO of the company should also focus to improve the team work within the organization. The cross cultural team work within Home Furniture could be improved with the investment on training and development programs. It is recommended that the management of Home Furniture should have the provision of various online and offline training programs. Another key solution for Home Furniture is comm unication. It is recommended that the leaders should focus on both formal and informal communication channels. The communication should be effective across different regions of Home Furniture. The regional offices of America, Europe and Asia should have regular communication. It is recommended that the management should have the strategies and policies to manage the intercultural conflict. It would be correct to say that the conflict management would be a key for organizations to move forward (Berg, 2012). 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